Monday, June 29, 2015

Tennessee and New Mexico Provisions Deemed Unconstitutional

Florida has its share of recent and pending constitutional challenges to workers' compensation. We are currently watching Castellanos and Westphal at the Supreme Court. Recently, we learned that the 11th Circuit decision of Judge Cueto (Miami) would more likely avoid the Supreme Court and instead return to the trial judge from the Third DCA on remand, for dismissal. Thus ends (?) the challenge that was commonly referred to as Padgett.

There are other constitutional challenges going on around the country. There was a recent decision in Oklahoma that called exclusive remedy into question. There are a variety of constitutional challenges to the Oklahoma Opt-Out that are being considered also. I mentioned some of these in Court Watching recently. 

Just last week, the New Mexico Court of Appeals declared a provision of that state's statute unconstitutional. New Mexico does not statutorily require coverage for farm and ranch workers. The Court concluded that the distinction of this section "fail to serve the purpose of the Workers' Compensation Act" and that the distinction results in "dissimilar treatment of similarly situated workers." More on New Mexico in a future post. Interestingly, this is a constitutional challenge to force inclusion of workers in the system, compared to Padgett, a challenge to allow workers to leave the system. 

In March 2015 a Chancery Court Judge in Nashville, Tennessee concluded that a portion of that state's workers' compensation law is unconstitutional. The story first came to my attention on The Tennessean, but there is also a good blog on the subject on Knoxblogs.

The issue sounds like an equal protection dispute. Tennessee's law is drafted so as to specifically provide less benefits to undocumented workers. In striking the provision, the Chancellor concluded that the question was controlled by Arizona v. United States (U.S. 2012). Essentially, that is a preemption case which concluded Arizona could not regulate immigration because the federal government so regulated. Interestingly, Arizona is the authority that Florida lawyers relied upon in challenging the prohibition on false statements made to obtain employment in Brock (the Florida constitutional challege that has arguably received the least coverage). 

Brock was decided by the Fourth DCA in April of 2014. Last fall, the Florida Supreme Court declined to hear the case. Earlier this year, the U.S. Supreme Court denied the petition for writ of certiorari.  Thus the Fourth DCA decision stands. Essentially, it is illegal to make misrepresentations in obtaining employment, whether you are an immigrant or not. It is important to remember that in Florida a District Court decision like Brock is "binding authority" in that district, but not in other districts. Thus, a similar challenge to Fla. Stat. 440.105 could be pursued in another district and the result could be contrary to Brock.

When two district courts have reached opposite conclusions, the Florida Supreme Court can review the question(s) under what is commonly referred to as "conflict" jurisdiction. Thus, any conflict is resolved by the state's highest court. There are those who argue that the Florida Court's consideration of Westphal is pursuant to such, but is to resolve a conflict between the full First DCA in Westphal and the full First DCA in Matrix Employee Leasing v. Hadley. Of course, the Supreme Court is reviewing Westphal on certiorari (request), not on conflict. But it illustrates the concept of conflict. Courts can reach conclusions that are diametrically opposed to other decisions, even its own.  

In Brock, the Florida Fourth DCA did not find Fla. Stat. 440.105 to be an immigration law, and concluded that it was constitutional. The Tennessee Chancellor concluded otherwise regarding the restriction on benefit levels resulting from status as documented or undocumented. In doing so, he concluded "by limiting benefits to the workers," the legislature "intended to establish what amounts to a state immigration policy, but that could not trump federal law."

The Tennessee court does not address the question of whether criminal activity (immigration status) can be prohibited. It simply concludes, following Arizona that the states cannot punish certain activity. Worker status therefore cannot be the basis for a determination of the volume of benefits due. The state law in Tennessee, in specifically delineating benefit levels based on worker status violates the preemption doctrine that affords the federal government exclusivity in addressing issues within the express grants of the people and states to the federal government (the people and the original states were here first and formed the federal government, in the process granting it specific powers). 

One distinction between this Tennessee analysis and the Brock analysis may have been legislative intent. The Tennessee bill that resulted in its law included an introduction. That introduction referenced the purpose of the statue as preserving "traditional legal immigration" and the purpose was to "encourage the employers of this state to comply with federal immigration laws." I am aware of no such statement of intent regarding Fla. Stat. 440.105. Can one infer, in the absence of such a statement, that this Florida statute was intended as an immigration enforcement?

It is also worth noting that the Tennessee provision specifically refers to immigration status as a criteria in determining benefit entitlement, thus a facial constitutional challenge. The provisions of Fla. Stat. 440.105 make no such specific references to immigration status, race or national origin, suggesting that challenges thereto would be on the basis of how the statute is "applied."

Facial constitutional challenges require a showing that there are no circumstances in which that statute can be applied appropriately. The courts, in such challenges, consider the facts or situation in the case actually before them. but also search for any circumstance in which the provision might be appropriately applied. If any such circumstance can be identified, the statute is not facially unconstitutional.

As applied constitutional challenges require a less stringent proof. In this setting, the challenger need only prove that the application of that statute to a specific set of facts results in an inappropriate outcome on those facts, under the constitution. 

The greater distinction between the two types of challenges is their precedential value, that is the future impact of the court's decision. Generally, once a court decides an issue, it is bound to follow that decision. The current conflict between Westphal and Matrix suggests that precedent is neither a constant nor an absolute however.

A declaration that a statute is facially unconstitutional will render it invalid per se in all future applications. It is a broad result, based upon a broad consideration of both the presented factual setting and any other potential factual setting. The result in an as applied challenge is more limited, resulting in invalidation of a statute in a particular case. Thereafter, that result might be argued to be applicable to support a similar result in similar factual cases, but is not as clearly a blanket prohibition. 

These recent decisions in Tennessee and New Mexico affect the respective statutes in a facial manner and will thus likely have wide spread application in those states. As we await decisions in Westphal and Castellanos, we can wonder whether the Florida Court will find those constitutional challenges persuasive (it remains unclear whether the Court might simply conclude that the challenged statutes are constitutional), and if so whether any infirmity found will be facial or as applied in those specific cases. 

It is worthy of consideration that Westphal may not even be a constitutional challege at this point. The First District did initially invalidate specific provisions of Fla. Stat. 440.15 in a panel decision (three judges). The panel concluded that this section is contrary to "natural law." When the full court ("en banc") considered the challenge in Westphal there were multiple opinions written, but none of them concluded that the statute was unconstitutional. The "natural law" challenge was seemingly abandoned. 

A year ago, Risk and Insurance questioned whether more states would pass laws restricting benefits for immigrants. It seems that this is unlikely in light of Arizona, whose impact can be seen in this regard so recently in Tennessee. Seeing that the Tennessee courts will not enforce such a distinction may discourage other states from this course. 

*Update, February 20, 2016: The Florida Supreme Court has yet to rule on Castellanos or Westphal. The New Mexico Supreme will reportedly review the decision of the New Mexico Court of Appeals. In the interim, the high court has issued an order suspending the effects of that decision. 

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